Monday, August 04, 2008
Josh Weintraub Hasn't Helped GMAC, So They Promoted Him
From the Wall Street Journal,
ResCap Under Duress in Derivatives
Mortgage lender Residential Capital LLC's value in the credit markets is like that of a company on the verge of taking its last breath.
ResCap, parent GMAC LLC, and General Motors Corp, which holds a 49% stake in GMAC and reported abysmal earnings Friday, are also under duress in the $62 trillion derivatives market.
Derivatives investors are now paying $7 million up front to insure $10 million of ResCap's bonds, plus $500,000 annually for five years based on credit-default-swap levels. This high cost is extreme but not out of context considering the going value of ResCap's bonds outstanding.
ResCap's junk-rated 8.375% notes due in 2010 were valued at all of 29.5 cents Friday. Other bonds, such as the 8.5% notes due in 2012 and the 8.875% bonds due in 2015 traded as low as 25 cents on the dollar, according to KDP Investment Advisors.
But guess what? Eerily mirroring his *rise* at a sinking Bear Stearns, Josh Weintraub was just promoted at foundering GMAC!
It didn’t take long for the ex-Bear Stearns mortgage hands to move to the front of the pack at Residential Capital, LLC, with GMAC Financial Services announcing Tuesday that Thomas Marano had been named chairman and chief executive officer, effective immediately, replacing current CEO Jim Jones.
ResCap also said it had promoted Josh Weintraub into the role of ResCap vice chairman; Weintraub joined the company along with Marano, so his rise shouldn’t come as a surprise.
I am actually still laughing at that article that I referenced which called Tom Marano a "mortgage whiz". For crying out loud, these clowns bankrupted an 85 year old investment bank with their wizardry.
I guess if your ship is destined to sink, as GMAC is, why not hire the crew from the Titanic?
Now obviously I don't have much on Josh Weintraub today - though a couple of his high school classmates have recently emailed me some *dirt* on him. But I just had to pen another blog on Josh because, well, his family frantically checks my blog almost everyday to see if there are any more comments on their golden child - I guess.
Or perhaps they've been smitten by my wells of insight and wit?